In this insightful interview, we sat down with Abraham White to discuss the remarkable journey of Bizcap and its role in the SME lending landscape. The interview covers valuable insights into the world of SME lending and answers important questions that are relevant for both SME owners and brokers seeking reliable partners.
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Uncover the key benefits that Bizcap offers in the SME lending landscape and how it can potentially benefit both SME owners and brokers. Don’t miss this informative interview, click here, to watch the full interview.
Ryan Johnson [00:00:07] Hello and welcome to Australian Broker TV. I'm Ryan Johnson, journalist for Australian Broker and joining me today is Abraham White, Joint Managing Director and Co-Founder at Bizcap. Welcome to you Abraham, and thank you so much for being here today.
Abraham White [00:00:22] Great to be around. Thanks for having us.
Ryan Johnson [00:00:24] Well, firstly, how would you describe Bizcap? For someone unfamiliar with your service?
Abraham White [00:00:28] Yeah, so Bizcap was launched in the Australian market initially, four years ago, after we realized a huge gap in the market coming from America initially, that the current lenders in the market at that time there was really no open mindedness, and really thinking outside the box look into SME lending. So in saying that, we decided to look at styling Bizcap, as the lender that could really think outside the box and look for reasons to find deals when other vendors would not, we can turn around deals in under three hours. We fund loans anywhere from 5[000, up to $4 million in Australia, and up to $2 million in New Zealand, and saying that it's up to a million usually not asset backed and the 4 million asset backed our head offices in Melbourne, and Auckland firm in Australia, New Zealand, but we have offices across Australia as well, with over 80 team members now. And just last month alone, we helped just under 1[000, SMEs to get funding for their businesses.
Ryan Johnson [00:01:30] What sort of trends are you noticing in the industry and the SMEs? You're working?
Abraham White [00:01:35] Yes. So we're noticing it's harder than ever for SMEs to get the funding they need, especially from the big banks where sometimes taking three months just to hear the answer no. And that wasn't good, even invoice factoring and asset finance, it's becoming more difficult to get the extra funds they need. And we're also seeing a huge demand in the construction industry, especially with our chain flows, slowing down through the issues that have come up last couple of years with rise of logistics costings, and so on, where it's doubt trickling down to the traders as well, which then affects across the broader SME market. But there's also in saying that there's never been more opportunities for SMEs in the current space, where in regards to retail, where we're speaking to a lot of them, were saying they just have opting to buy stock for much cheaper than before, and opportunities to they're able to get access to the cash, they can get better deals. And with Christmas season coming up in end of the year, it's now a great opportunity for them to have access to the funds, they need to buy stock and be ready for that time to continue growing their business.
Ryan Johnson [00:02:42] What are some other client challenges that your product resolves?
Abraham White [00:02:46] Yeah, so Bizcap's main thing that we try to resolve is obviously speed to market so we can help clients get up to that $1 million non asset backed in three hours. We're also happy to help clients who may already have received funding from other lenders, but may have not received enough or need that bridge lending. We're also happy to help clients who have had, you know, discharged bankruptcy, credit descriptors in the past default, judgments don't want really think outside the box, no minimum credit requirements for other ones do because we really look for reasons to fund deals, we're happy to help clients who may even have ATO debt where sometimes ATO debt could be the cheapest form of funding for a client, where by utilizing that funds instead now, as long as they go on a payment plan and deal with it, and actually help the cash flow crunch they're having. The other thing is really think outside the box with bridge lending and flexible funding, that when clients are looking for sometimes the funds for a shorter period where they need just to fill that gap. So this gap can really help in those need.
Ryan Johnson [00:03:49] Now you say you lend up to $4 million? What sort of customers and scenarios are people getting funds at that level?
Abraham White [00:03:56] Absolutely. So typically deals up to $4 million will have some sort of security behind them as well. But I can give you a couple of examples of bridging clients who really had great businesses going through an example would be a client who had huge government contracts in the construction space, where they will continuously waiting on extra few delays from the government to pay but they sought to pay their staff they still like to pay their, their project managers and for the suppliers and so on. But what was happening was, is that they need that gap here. But this is a business out, let's say turning over $240 million a year plus, right so you think that business like that? Where is the act of going to the bank, but the banks make you jump through hoops every time to get even a small increase in the funds. So coming to Bizcap as a short term option and bridge option allows them to borrow funding and typically they will take them for about a year about one Oh, just over $1 million every month, confusing and paying it back within four weeks for a huge discount on the cost of funds. The other example would be businesses who are having huge rapid growth we're dealing with a client today, just for example, we've already funded them recently 3.5 million, and then are coming to us with an additional half a million dollars today. Where the reason is because they're grown to international there have projects in the United States as well. They're an Adelaide based company and they're really been growing. And we're Bizcap comes in for them is it continues so needy, even though they do have, they do have traditional funding as well to the big things that funding is designated specifically to a specific project or a specific property, where in this case with Bizcap, we can provide them just additional cash flow to help them pay for expansion, extra marketing costs, extra material costs, and that's really where we find we can be a huge value add to our clients.
Ryan Johnson [00:05:48] What do customers need to be eligible and what can they expect?
Abraham White [00:05:52] So we can lend up to 1[00% of customers, the average monthly revenue, with a secure loan, we can go significantly higher more than that. The main thing is a when you're with Bizcap is all rules are made to be broken. And the reason why is because at Bizcap, we have no institutional funding or debt facilities like other ones in the marketplace. So it means we can really think outside the box when other vendors aren't able to do that.
Ryan Johnson [00:06:15] And finally, what are the benefits of partnering with Bizcap?
Abraham White [00:06:19] Yeah, well, the first thing is the benefits for your clients obviously, is a lender that can fund loans up to a million dollars within three hours up to 4 million on the same day, within 24 hours. Our customer repeat rates to over 65% which means you have continued injection of capital for your clients as well as trail commissions for yourself as a brokerage. We give brokers the choice of either if they're very hands on brokers and work with the client all the way through if their brokers who aren't nowhere as much with the commercial lending or SME space, whether you can just tick and flick and the number email to our account management team who all they do all day is sell this capital loans and focus on helping small businesses or we give brokers a choice to work with the clients hands on and then choose their own commission rates based on the rate the loan is sold at and so on. So it gives that flexibility to brokers where they can choose how to handle the deal. We pay leading industry commissions as well as happening credible BDM team we're always there to answer any questions you have, as well as offering monthly bonuses and GBIs to help brokers really hit those targets they need to hit so gear to always answer any questions brokers have and support them in helping their clients grow.
Ryan Johnson [00:07:33] Well thank you so much once again for your time today. Abraham It was lovely speaking with you.
Abraham White [00:07:38] Thanks so much, Ryan.
Ryan Johnson [00:07:40] And thank you, of course to our viewers for watching the latest episode of Australian Broker TV. We look forward to seeing you again today.